President Donald Trump has launched a fresh attack on Federal Reserve chairman Jerome Powell after the central bank opted to leave interest rates unchanged, prompting an immediate backlash from the White House.
The Fed voted 10–2 on Wednesday to hold its benchmark lending rate at between 3.5 and 3.75 per cent, a decision that drew swift criticism from the president.
Posting on Truth Social, Mr Trump accused the central bank chief of acting too slowly.
“Jerome ‘Too Late’ Powell again refused to cut interest rates, even though he has absolutely no reason to keep them so high,” he wrote, urging the Fed to “substantially lower interest rates, NOW!”
The remarks add to a long-running pattern of attacks on Mr Powell, whom Mr Trump appointed during his first term and has previously labelled a “major loser” and a “numbskull”.
Mr Powell addressed reporters shortly after the rate announcement, holding his first press conference since the Department of Justice opened a criminal investigation into his Senate testimony regarding renovations to Federal Reserve buildings.
He declined to comment on the probe, instead using the appearance to defend the central bank’s independence and warn against political interference in monetary policy.
Allowing elected officials to influence rate decisions, he said, would undermine credibility that would be “hard to restore”.
President attacks central bank chairman after Fed’s decision to hold interest rates
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He also referenced a related Supreme Court case involving Federal Reserve governor Lisa Cook, describing it as “perhaps the most important legal case in the Fed’s 113‑year history”.
Financial markets reacted unevenly to the decision.
In London, the FTSE 100 closed 17.33 points higher at 10,171.76, while US indices moved lower.
The Dow Jones Industrial Average slipped 0.3 per cent, the S&P 500 fell 1 per cent and the Nasdaq Composite dropped two per cent, with technology stocks leading the declines.
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Donald Trump
The S&P 500 had briefly touched 7,000 points for the first time earlier in the session before retreating following Mr Powell’s comments.
Analysts said investors remain cautious about the path of interest rates.
Ellen Zentner, chief economic strategist at Morgan Stanley Wealth Management, said “the Fed song remains the same”, adding that while rate cuts may eventually come, “investors will have to remain patient”.
The Federal Reserve said its decision reflected the continued strength of the US economy.
Mr Powell noted that recent data had exceeded expectations, saying “the economy has once again surprised us with its strength”.
Inflation remains above the Fed’s two per cent target, though officials said the tension between employment and inflation pressures has eased.
Two members of the Federal Reserve dissented, with Stephen Miran and Christopher Waller both voting for a rate cut.
Mr Miran is currently on leave from his role leading the White House Council of Economic Advisers, while Mr Waller, appointed by the President, has been mentioned as a potential successor to Mr Powell, who is due to step down as chairman in May.
BlackRock executive Rick Rieder has emerged as a leading contender to replace him, though the White House has not commented on the succession process.
The Fed reiterated that future decisions will depend on economic data, with Mr Powell saying the central bank will act once it is confident inflation is moving sustainably towards its target.